Decarbon Daily - EVs in Argentina & 100k EVs to Hertz
Inside this issue
As part of the global perspectives series, Veronica Geese joins us from Esparanza, Argentina to share new policy and investments that are coming to Argentina. You can read about Decarbonization efforts in Africa by Joshua Olayori in Ifo, Nigeria in part 1 of the series. ~Todd
EVs in Argentina, finally a step forward for electromobility?
The federal government of Argentina presented a draft for an electromobility law this month that aims to lay the groundwork to ban the use of internal combustion engines in the country by 2041.
Argentina wants to seize the opportunity to revitalize the national automotive industry to:
* improve the sector's trade balance, which today is in deficit
* expand current industries and create new ones, aiming to export so as to reposition the country as a supplier at the regional and international level
* exploit new related technologies such as batteries, AI, big data and new materials.
New Hope for Argentina's Automotive Industry
The bill estimates as results for 2030, investments for USD $8.3 billion, exports for USD $5 billion and 21,000 new jobs, including automotive terminals, the auto parts sector and battery manufacturers, in addition to obtaining a cumulative saving of 10.7 Million tons of CO2 equivalent.
The law establishes a regime of benefits for demand and supply. For demand, the law establishes a Green Bond - a direct discount on the price of the vehicle as well as in auxiliary equipment (chargers) - and removal of the taxable base in personal property. For supply, the regime creates benefits for Productive Projects:
* Static Tax Benefits, for the installation of new Productive Projects of Sustainable Mobility
* Dynamic Tax Benefits, for the fulfillment of goals, such as exports, employment, sustained technological improvements and productivity, development of suppliers and subnational participation
This regime lasts 20 years with benefits decreasing over time to accelerate investments. There are also quotas for the acquisition of fleet vehicles by the National Public Administration and to replace the public passenger transportation fleet, mostly in the metropolitan area of Buenos Aires, which will be a significant incentive for investors.
In order to ensure the financing of the whole regime, a Public Trust Fund is created to guarantee the reliability and sustainability required throughout the 20 years, the Trust will take funds from different sources, including taxes on liquid fuels and CO2 that today already exist.
The whole project is based on the need to decarbonize the local economy to fulfill the country's international agreements. However, Argentina also wants to combine technological development and structural change of its economy with cross-cutting policies that may reduce the carbon footprint and the consumption of materials and natural resources to have less environmental impact.
This proposal for a Sustainable Mobility Promotion Law comes at a difficult economic moment for the country with mid-term elections this November and macroeconomic weakness evident. In this situation, the government needs to show a plan for the future, which is why riding the green wave could, if successful, meet several political, environmental, economic and social objectives.
South America's Role in Tackling Climate Change
In the region, Chile and Uruguay have advanced in electromobility, but with an agenda of less local industrialization because of their scales. On the other hand in Brazil, Argentina's partner in MERCOSUR and importer of 66% of the vehicles that Argentina manufactures, is debating a ban on gasoline or diesel vehicles by 2040. This is mixed with the geopolitical agenda of President Bolsonaro, eminently anti-globalization or anti "ecoterrorism", as he expressed in his election campaign. In this regional scenario, if Argentina can quickly define a local development of electromobility, it could be a game changer for the whole region.
We must take a closer look at the international debate on the environmental issue and the role of countries such as Argentina and South America in general, which have a surplus of natural resources but large and long term economic and human development deficits. There is an approach, which has been present since the beginning of the treatment of the climate change issue in international organizations, and it is the concept of “climate justice”, which will surely be mixed with geopolitical conflicts over natural resources such as minerals, water, and fertile soils.
It is this approach that South American countries will surely carry as a banner from now on, to try to prevent that this new era of environmental care may generate more technological dependence in the hands of the more developed countries, depriving the less developed ones from innovating in their productive chains, adding value and increasing local jobs.
Even though this is one bill, for Argentina it is a clear sign. First, this government has not continued the renewable energy policies of the previous administration and has a bipolar discourse regarding climate change. Second, this is the first bill that tries to give a long-term future perspective. Third, it would be the first clearly productivist measure for electromobility in almost two years of the current administration.
The natural and human resources are available, the industrial framework can answer this call, but ultimately everything will depend on the credibility of the country's political-economic system, and that is where it will be seen whether the audacity of this project can be translated into reality or whether it will remain, once again, only on paper.
Inside this Issue
🎯 Hertz Orders 100,000 Teslas, the Single-largest EV Purchase Ever, with Tom Brady Campaign
⛏ A Mining Company is Sifting Through Mineral Sludge for Rare Materials as Disruptions Dent the Supply of Critical Tech Components
🚛 These New Electric Trucks Could Take Over The Commercial Industry
📈 EV Sales Forecasts by EVadoption
Articles in this issue